The Moab City Council approved a resolution Tuesday, Nov. 14 that adopts new amounts for the city’s Health Reimbursement Arrangement (HRA) with employees that are full-time (30 hours or more per week), waive the city’s group health plan and have coverage under a spouse/domestic partner’s Employer’s Group Health Plan.
Under the new plan, which will take effect Jan. 1, 2018, employees are entitled to receive reimbursement for eligible medical expenses incurred by themselves, their spouses and dependents. For a single participant, the HRA puts a $6,697 annual limit on reimbursements, with an additional $1,206.28 available under a wellness incentive. For a city employee that is covered with one other person, that rate goes up to $13,984.59 (plus $2,518.96 for wellness) if the spouse is covered, and $12,988.27 (plus $2,339.49 for wellness) if a child is covered. The family plan would reimburse up to $20,347.25 (plus $3,665.03 for wellness) annually.
The plan will reimburse all medical expenses for covered employees and dependents that are excludable from income under the federal tax code. The plan does not reimburse for the cost of over-the-counter drugs unless the medication is a prescribed drug.
The plan was approved unanimously after a pre-council workshop where Moab City Manager David Everitt made a presentation regarding the state of health care among city employees.
“The City of Moab is not immune to the nationwide trends regarding health care costs,” Everitt stated in a memorandum to the council. “After some negotiation, we were able to reduce an anticipated 13-15 percent increase in premiums to 12.5 percent. The upshot is an increase of $174,000 in premium costs overall.”
According to Everitt, a committee of city employees met twice to review the increased costs and provide a recommendation regarding how to pay for these increases.
“Employees’ current per-month contributions to premiums are set amounts: $15, $30, and $50 for an individual, two-party, and family respectively. The Committee recommended that employees take on a share of the additional costs by assuming responsibility for 5 percent of the relevant health insurance premiums going forward. This equates to a monthly contribution of $34.66, $67.23, and $105.32, respectively,” Everitt wrote.
Everitt added that the city would cover the rest of the premium increase in the amount of $102,362.
“In order to attempt to control rising costs in future years, we are proposing the implementation of a more robust wellness program that includes an incentive for employee participation,” Everitt stated. “The program will offer health screenings and evaluations, and will compensate employees who meet agreed-upon health goals. The committee proposed offering an incentive for participation of an additional contribution into the employee’s Health Savings Account or Health Reimbursement Account.”
According to Moab City Communications and Engagement Manager Lisa Church, any HRA funds that are not used by the end of the fiscal year are returned to the city coffers.